The Impact of National Cultural Factors on the Effectiveness of Process Improvement Methods: The Third Dimension

Adopting the practices of the worlds leading economy
is a desirable and sensible strategy, since these practices
are based on the largest existing pool of experiences. The
question is whether these practices will be equally effective
in other areas of the world where different national cultures
condition different value systems. Capability Maturity ModelIntegrationSM
(CMMI) is a framework from which models can be generated
for different organizations. It is open to considerations
regarding all kinds of circumstances including differences
in cultural value systems that were characterized in G.
Hofstedes seminal work. The statistically identified
clusters of characteristics of national cultures are: power
distance, individualism vs. collectivism, masculinity vs.
femininity, uncertainty avoidance, and long-term vs. short-term
orientation.

With this article, the authors intend to contribute
to the international success of CMMI and of all other process
improvement methods by proposing to work toward a third
dimension of the CMMI/SPICE architecture: the cultural dimension,
in addition to the process and capability dimensions of
the existing models.

EDITORS NOTE: Many projects now extend beyond a
single national setting, drawing upon team members in varying
cultural settings. Despite the influences of globalization,
significant differences exist in local outlook and expectation.
The following treatment is a preliminary exploration of that
situation for software process perspective, as well as a call
for additional, more rigorous research.

Supporting Details of the
Sociological BackgroundCharacterizations of national
cultures are not to be understood as meaning to stereotype
any nation or its citizens, but to be a shorthand representation
of particular clusters of outlooks and expectations.

INTRODUCTION

The seminal work (Hofstede 1994) identifies the generic factors
that characterize value systems in different national cultures,
including those of software and systems developers, applying
statistical cluster analysis. The analysis was based on questionnaires
from more than 50 countries. Each country could be given an
index score for each of the following factors or dimensions
of national cultures:

Power distance characterizes the extent to which
people consider it natural that power, status, and privileges
are distributed unequally among individuals or that this
distribution has no high significance in their lives. In
small power distance countries subordinates and superiors
consider each other as existentially equal, and decentralization
is popular, while large power distance countries subscribe
to authority of bosses and centralization.

Individualism vs. collectivism characterizes peoples
esteem of individual activities and successes vs. the importance
of their belonging to a social group. In an individualist
culture people are supposed to take care only of themselves
and their immediate families, and remain emotionally independent
from the group. In a collectivist culture people distinguish
between in-groups and out-groups, expect their in-group
to look after them, and individuals define their identity
by relationships to others and group belonging. The individual
and the group have a mutual obligation of protection in
exchange for loyalty.

Masculinity vs. femininity is better expressed
as confrontation and quantity orientation vs. compromise
and quality orientation. In masculine cultures importance
is placed on assertiveness, competitiveness, and materialism
in the form of earnings and advancement, promotions and
big bonuses. A feminine culture indicates the concern for
people, the quality of life, nurturing, and social well-being.

Uncertainty avoidance characterizes peoples
attitude toward ambiguous or unknown situations. Innovation
usually involves a lot of uncertainty; it is by consequence
easier in weak uncertainty avoiding cultures. A strong uncertainty
avoiding culture creates high anxiety in people who usually
like to work hard and like establishing and following rules.
The actual implementation of the results of innovation is
an activity that requires this attitude.

All four factors are a continuum between two extremes, and
no national culture is at one or the other extreme. Furthermore,
the index scores are statistical results, which means there
are always individuals who do not conform to the general model.
By consequent, the model is not meant to and should not be
used to stereotype people from various cultures.

There is in fact a fifth factor identified only later due
to the natural western cultural bias of the experts themselves
compiling the questionnaires used for the study. This is:

Long-term vs. short-term orientation or Confucian dynamism
(Hofstede 1994), which means persistence, establishment,
and observation of priorities, thrift, and a sense of shame
on the long-term orientation pole, personal steadiness,
protection of face, respect for traditions,
reciprocation of greetings, favors, and gifts on the short-term
orientation pole.

THE THIRD DIMENSION

The following discussion is based on the Capability Maturity
Model Integration (CMMI)SM framework. It can, however, be
applied to any method designed to improve the processes of
an organization. CMMI is a framework from which models can
be generated for different organizations. Although process
areas depict behavior that should be exhibited in any organization,
practices must be interpreted using an in-depth knowledge
of the CMMI model, the organization, the business environment,
and the specific circumstances involved (CMMI 2000).

The previous statement bears a striking resemblance to Mary
Parker Folletts way of thinking (Metcalf and Urwick
1940), which is not surprising because CMMI was developed
in the U. S. cultural environment, and the essential characteristics
of national culture are enduring despite all industrial and
societal changes. Mary Parker Follett (1868-1933) was a U.
S. pioneer of organization theory. It is fortunate that, at
the same time, this statement clearly demonstrates the intention
to be open to considerations regarding all kinds of circumstances,
including differences in cultural value systems.

CMMI continuous representation is often illustrated as having
a two-dimensional structure with the process dimension on
one side and the capability dimension on the other. This is
a sound approach, since each (process area, capability level)
pair has a well-defined meaning and implies suitable improvement
actions.

With
this article, the authors propose to work toward a third dimension
(see Figure 1) in the
CMMI architecture: the cultural dimension. This model extension
is valid, since the national cultural position of the company
may determine a different meaning and suitable improvement
actions for every (process area, capability level) pair, or
even every (process area, specific or generic practice) pair
using a finer granularity of CMMI where process capability
levels are achieved by performing the specific or generic
practices on the process areas. In short, the effectiveness
of various practices depends on the national culture where
they are performed. In fact, this model extension can be fully
accommodated by even the current version of the CMMI, since
all practices are only expected and not required model components
(CMMI 2000).

The cultural dimension itself is multidimensionally determined
by Hofstede, but there are other models of national cultures
that are also valid and that the authors intend to leave the
new model open to.

To remain as consistent as possible with the structure of
the CMMI continuous model, the new cultural dimension has
model components similar to those of the capability dimension
of CMMI. Nevertheless, the authors use the old maturity
level terminology instead of capability level
for the cultural dimension, since it is a better description
in this case. The model has also similarities with the ancestor
of CMM: Crosbys Maturity Grid (Paulk 1995; Messnarz
and Tully 1999; Crosby 1979).

Cultural maturity level 0 (closed)The cultural maturity level of a process area
at a given capability level is 0 if the specific and/or generic
practices, leading to the achievement of the specific and/or
generic goals of the process area at the given capability
level, are prescriptive to the extent where no differences
in cultural value systems are allowed.

Cultural maturity level 1 (open)The cultural maturity level of a process area
at a given capability level is 1 if the specific and/or generic
practices, leading to the achievement of the specific and/or
generic goals of the process area at the given capability
level, are open enough to allow for differences in cultural
value systems.

Cultural maturity level 2 (model based)The cultural maturity level of a process area
at a given capability level is 2 if the consideration of
cultural differences is based on a scientifically established
model. Hofstedes multidimensional model is an example,
but other models are also acceptable in case they are useful
in distinguishing the differences in cultural value systems
that have an impact on the performance of the specific and/or
generic practices.

Cultural maturity level 3 (comprehensive)The cultural maturity level of a process area
at a given capability level is 3 if the scientifically
established cultural model is comprehensively applied to all
specific and generic practices leading to the achievement
of the specific and/or generic goals of the process area at
the given capability level.

Cultural maturity level 4 (tailored)The cultural maturity level of a process area
at a given capability level is 4 if the depth and complexity
of the application of the cultural model to the specific and
generic practices is based on quantitatively managed experience
and business needs.

Cultural maturity level 5 (competency driven)The cultural maturity level of a process area
at a given capability level is 5 if the cultural model
applied to the specific and generic practices is refined,
extended, or fully changed on the basis of competency acquired
through quantitatively managed long-term model experience
and business needs.

Level 1 Generic Cultural Goal

At level 1 the generic cultural goal is to create an organizational
culture where specific and generic practices allow for differences
in cultural value systems when the need is identified. A level
1 Generic Cultural Practice (GCP) is to scan specific and
generic practices for cultural restrictions and relieve the
identified restrictions.

An excellent example of a practice in CMMI where cultural
restrictions are already partially relieved is Generic Practice
(GP) 2.4: Assign Responsibility (CMMI 2000). The description
of the practice contains the following: Responsibility
can be assigned using detailed job descriptions .
Strongly uncertainty avoiding German engineers will love this
approach as opposed to weakly uncertainty avoiding Swedish
engineers. GP 2.4 states, however, that Dynamic assignment
of responsibility is another legitimate way to perform this
practice . One can claim by consequent that GP
2.4 can actually be adapted to both weak and strong uncertainty
avoiding national cultures.

Level 2 Generic Cultural Goal

Specific and generic practices take cultural differences
into consideration on the basis of a scientifically established
model. A level 2 GCP is the application of an element of the
cultural model to selected specific and generic practices.

In the case of the Hofstede model, GCP could be the following:

GCP 2.1: Consider the power distance factor in
selected specific and generic practices.

In CMMI GP 2.4 of the previous example, the consideration
of the individualism vs. collectivism factor of the Hofstede
model (GCP 2.2) leads to another cultural restriction of this
practice that should be relieved.

The assignment of responsibility is strongly related to the
individualism vs. collectivism dimension. Should the responsibility
be assigned to people or teams? The wording of GP 2.4 reflects
cultural conditioning: Confirm that the people
assigned to the responsibilities and authorities understand
and accept them (CMMI 2000).

To illustrate the importance of this issue, the authors quote
(Hofstede 1994) referring to a management researcher from
the United States, Christopher Earley, who performed an enlightening
laboratory experiment on a group of 48 management trainees
from southern China and 48 matched management trainees from
the United States. Half of the participants in either country
were given group tasks, the other half individual tasks. Also,
half of the participants in either country, both from the
group task and from the individual task subsets, were asked
to mark each completed item with their names. The other half
turned them in anonymously. The Chinese collectivist
participants performed best when operating with a group goal
and anonymously. They performed worst when operating individually
and with their name marked on the items produced. The American
individualist participants performed best when operating individually
and with their name marked, and abysmally low when operating
as a group and anonymously.

In addition to GP 2.4 and many other parts of CMMI, the previously
mentioned experiment has a profound impact on such Integrated
Product and Process Development (IPPD) such as Organizational
Environment for Integration and Integrated Teaming.

Level 3 Generic Cultural Goal

The scientifically established cultural model is comprehensively
applied to all specific and generic practices. A level 3 GCP
is the systematic application of an element of the cultural
model to all specific and generic practices. In the case of
the Hofstede model, GCP could be the following:

GCP 3.1: Consider the power distance factor in
all specific and generic practices.

CMMI GP 2.8: Monitor and Control the Process and GP 2.10:
Review Status with Higher-Level Management are both affected
by GCP 3.1 and GCP 3.4. CMMI GP 2.7: Identify and Involve
Relevant Stakeholders is, on the other hand, affected by GCP
3.3 and GP 3.2: Collect Improvement Information by GCP 3.5.

GCP 3.1: Power Distance considered in GP 2.8: Monitor
and Control the Process and GP 2.10: Review Status with Higher-Level
ManagementBoth of these generic practices require a review involving
communication with either the immediate level of management
or higher-level management. Power distance has a determining
impact on the communication considered appropriate in a given
culture.

Referring again to (Hofstede 1994) here is a quote of a senior
Indian executive from the United States. (Negandhi and Prasad
1971): What is most important for me and my department
is not what I do or achieve for the company, but whether the
Masters favor is bestowed on me.... This I have achieved
by saying yes to everything the Master says or
does.... To contradict him is to look for another job....
I left my freedom of thought in Boston.

It is obvious now that the way of performing generic practices
2.8 and 2.10 must take into account the power distance index
in the national culture where the organization is located.

GCP 3.4: Uncertainty Avoidance considered in GP 2.8: Monitor
and Control the Process and GP 2.10: Review Status with Higher-Level
ManagementTrack corrective action to closure is an important
subpractice of GP 2.8. Precision and punctuality required
by this subpractice is a natural characteristic of strongly
uncertainty avoiding cultures, which will by consequent be
better in this respect.

GCP 3.3: Masculinity vs. Femininity considered in GP 2.7:
Identify and Involve Relevant StakeholdersThe article (Atwong and Lange 1996) gives account of a
virtual classroom experiment with students of the California
State University-Fullerton and Lappeenranta University of
Technology, Finland. The subject of the experiment was a marketing
research project, which is irrelevant in this context. The
importance is that the project combined the American
and Finnish students into one virtual classroom with cross-national
teams. Students used the Internet extensively for data collection
and conducted Internet chats with foreign team members when
necessary. The message of the story can be summarized
with the opinion of a Finnish student: It was interesting
to see the effect of cultural differences, even in a relatively
simple project like this. When we first established contact
with our American teammates, they wanted first to introduce
themselves and chat about their interests and hobbies, which
we thought was strange. Later we realized that this was their
way to establish rapport with small talk. The Finns are used
to getting immediately down to business. In the oral presentations,
the American students seemed to emphasize presentation technologies
more than us. However, in my opinion the quality of the work
was roughly equal.

The previous observation is due to the difference between
the United States and Finland on the masculinity vs. femininity
scale, which is the only dimension where the United States
and Finland are significantly different. Assertiveness is
a characteristic that correlates more with masculine characteristics,
while modesty correlates more with feminine characteristics.
The involvement and the resolution of the conflicts of stakeholders
from even these two otherwise close cultures requires a careful
handling of the cultural differences without which both the
assertive U. S. students and the modest Finnish students may
find each other ridiculous, strange, shocking, or even hateful.

This issue, of course, must be taken into account while stakeholder
involvement is planned in the project planning process area.

GCP 3.5: Long-Term vs. Short-Term Orientation considered
in GP 3.2: Collect Improvement InformationProcess improvement as a whole, and especially this GP
3.2, clearly requires long-term orientation, that is, persistence,
establishment, and observation of priorities, and thrift.
Short-term orientation, which attributes high value to the
protection of face and the respect for traditions,
acts against process improvement.

Level 4 Generic Cultural Goal

Experiences with the consideration of cultural differences
are quantitatively managed, and the depth and complexity of
the application of the cultural model is based on the quantitatively
managed experiences and business needs.

Experience may indicate the need for a deeper application
of the Hofstede model. In fact, Hofstede himself examined
pairs of cultural factors in addition to the single ones.
GCP 4.1 considers such a pair. The number of pairs of the
five cultural dimensions is 5C2 = 10. One must be careful,
however, with increasing the number of considered combinations,
since the number of cases may increase exponentially, which
is not useful for ones purposes.

GCP 4.1 Consider the pair of power distance and
uncertainty avoidance cultural factors in all specific and
generic practices.

GCP 4.1: Power Distance and Uncertainty Avoidance considered
in GP 2.7: Identify and Involve Relevant Stakeholders The preferred way of resolving conflicts between stakeholders
can be predicted from the position of a culture in the two-dimensional
space of power distance and uncertainty avoidance.

(Hofstede 1994) describes the results of an organizational
behavior course examination reported by Owen James Stevens,
an American professor at INSEAD business school in Fontainebleau,
France. A mixture of French, German, and British students
received a case study where they had to resolve a conflict
between two department heads within a company. A sales and
a manufacturing manager, for example, usually have conflicts,
since sales tries to satisfy changing customer demands, while
manufacturing is more efficient if batches are larger and
changes are less frequent.

The results were striking.... The solution preferred
by the French was for the opponents to take the conflict to
their common boss, who would issue orders for settling such
dilemmas in the future.... The solution preferred by the Germans
was the establishment of procedures. The British solution
was the registration of both department heads to a management
course to develop their negotiation skills.

In summary, the French with large power distance and strong
uncertainty avoidance prefer to concentrate the authority
and structure the activities, the Germans with strong uncertainty
avoidance but smaller power distance want to structure the
activities without concentrating the authority, while the
British with small power distance and weak uncertainty avoidance
believe in resolving conflicts ad hoc.

Level 5 Generic Cultural Goal

The cultural model is refined, extended, or fully changed
on the basis of competency acquired through quantitatively
managed long-term model experience and business needs. For
example, there may be a need for the consideration of cultural
factors which are impractical to evoke from the existing cultural
model. Following are the discussions of GCPs for two such
factors.

GCP 5.1 Consider the discrepancy in perceived understanding

In (OSuilleabhain et al. 2000), a practical example
of the Johari window, is described showing how discrepancy
in perceived understanding is measured in the OSIRIS
European project.

The
Johari window is a tool originally designed for conceptually
distinguishing between four different possible states with
regard to knowledge of oneself; these states are shown in
Figure 2.

The same principle can be applied to measure four different
possible states with regard to knowledge of ones culture,
and the understanding of other cultures in the project team.

Respondents to the OSIRIS survey were asked to rate, on a
scale from 1 to 5, the discrepancy between the understanding
cultures in the ISIS project have of themselves, and the understanding
others have of them. The questions were based on the Johari
Window.

Figure
3 shows the perceived discrepancies between each cultures
understanding of itself and the understanding other cultures
have of it. Note that the ratings for each culture are by
the other two cultures not by their own culture.

The bigger the discrepancy, the smaller the incidence of
perceived shared understanding and, implicitly then, the fewer
issues open for discussion. It is interesting
that Germany was the only culture with an above-average mean
score, which may imply that other cultures more often than
not find their own understanding of German culture to be at
odds with that of the Germans own and that blind
spots, which can hinder effective interaction, may be
greater than the Germans themselves believe.

A typical sign when this Johari problem happens is that during
a certain project some results have to be reagreed a number
of times, although the Germanic group feels that clear definitions
have been agreed upon already.

This problem can be solved by moderating workshops in a way
that allows people to explain the different viewpoints and
identify synergies, finally resulting in common solutions.

GCP 5.1. German Do the managers understand that the once agreed-upon
business model might change, driven by stakeholder inputs
and new demands, and that cultural difference requires understanding
different viewpoints on the same.

GCP 5.2 Consider the SPI approach in relationship
with company culture and size.

As outlined in (Davison 2001) the movement of a large multinational
organization toward higher capabilty is a long-lasting agreement
process where step by step, one must win the confidence of
the managers and staff. Many tactics are needed to achieve
this. For example:

GCP 5.2. Large Are the stakeholder agreements achieved step by step
so that all involved parties are convinced and the joint mission
is clear?

CONCLUSION

CMMI intends to be effective in all national cultures. By
consequence, it should consider the way its practices can
most effectively be performed in different national cultural
environments.

This article draws attention to the deep relevance of this
issue to the international success of CMMI and other process
improvement methods. The eye-opening ideas are validated in
a general sense and are meant to justify undertaking a more
extensive study, which would require considerable resources
and a worldwide collaboration.

The authors of this article encourage the establishment of
a forum of people and organizations interested in sharing
their ideas and experiences on process improvement in different
cultural environments for improving effectiveness and suppressing
intolerance and conflicts due to unawareness of differences
in value systems.

Dr. Miklós Biro is an associate professor at
the Department of Information Systems and the Technology Transfer
Center of the Budapest University of Economic Sciences and
Public Administration. In addition to a doctorate in mathematics
(operations research) from the Loránd Eötvös
University in Budapest, he has an executive MBA degree from
ESC Rouen, France, and a master of science in management degree
from Purdue University.

Biro is a Bootstrap and SPICE assessor. He initiated and
managed the Hungarian participation in numerous European multinational
projects and organizations committed to software process improvement.
He was an expert consultant for many Hungarian and international
organizations (European Commission, Hungarian Committee for
Technological Development, Investment and Trade Development
Agency of Hungary, Hungarian Airlines, UNIDO, International
Software Consulting Network). He has numerous publications
in international scientific and professional journals and
conference proceedings. He is the author of Hungarian and
English language book chapters on operations research models,
software engineering, software process improvement, and business
motivations.

Biro is a member of the editorial board of the journal Software
Process Improvement and Practice, and founding president
of the professional division for Software Quality Management
of the John von Neumann Computer Society. He is the Hungarian
member of Technical Committe 2 (TC-2) Software: Theory and
Practice of the International Federation for Information Processing
(IFIP). Biro can be reached at miklos.biro@informatika.bke.hu
.

Dr. Richard Messnarz is executive director of ISCN.
He has a masters degree from the University of Technology
in Graz, Austria. He also received a doctorate from the University
of Technology for his work on QUESA Quantitative
Quality Evaluation System.

Messnarz was the technical coordinator in process improvement
initiatives such as PICO and Victory and the coordinator of
a software engineering group within the pilot project for
building a prototype of a virtual university. He is the editor
of the book Better Software Practice for Business Benefit:
Principles and Experience. Messnarz is a chairman and
the main organizer of the EuroSPI conference series. He can
be reached at rmess@iscn.ie
.

Dr. Alfred G. Davison is a senior engineer/manager
with a background in aeronautical, marine, telecommunications,
and process control industries. He has broad-ranging experience,
IT knowledge, and technical expertise. He has documented leadership,
motivational, planning, strategic, tactical, and operational
skills. He has fulfilled numerous roles, including CEO, director,
R&D manager, and QA/QC chief. His experience also includes
project management, product management, team building, business
analyst, and design engineer. He is currently engaged in research
on the organization of virtual software companies across geographical
and cultural boundaries together with a number of universities
across the world. Davison can be reached at gerry@marlab.dk
.

Capability Maturity Model and CMM are registered trademarks
in the U. S. Patent and Trademark Office. CMM Integration
and CMMI are service marks of Carnegie Mellon University.